If you want
to get this
newsletter
via email...
The Washington State
Labor Council's
pretty-much-weekly report on the
2004 session
THURSDAY, JANUARY 22 (download and print a PDF version)
We're No. 1! (which doesn't 'suck')"We're Number One!" will be the rallying cry of certain business lobbyists next week. No, it won't signal a respite from the non-stop negativity they spew about Washington state. They'll be talking (again) about how much "we suck."
The subject will be the state minimum wage. As of Jan. 1, Washington's lowest legal wage is $7.16 an hour, the highest in the nation, ahead of Alaska's $7.15, Oregon's $7.05 and California's $6.75. Agriculture, restaurant and retail lobbyists -- and some legislators -- say that kills Washington jobs. They point to our $7.16 minimum wage with one hand, to our higher-than-the-national-average unemployment rate with the other hand, and sum up their argument with, "See?"
Last year, 13 different bills were introduced to weaken our state minimum wage law. All failed, but one did manage to pass the Republican-controlled Senate on a 25-24 vote, and that bill figures to be the focus again in 2004. SB 5697 would essentially freeze our minimum wage, ending its voter-mandated inflationary adjustments except in years the state unemployment rate is below the national rate.
That amounts to a freeze because Washington’s jobless rate has fairly consistently remained above the national rate for the past 25 years. The last time it didn't was 5½ years ago in August 1998. Had SB 5697 been in place since 1992 the state minimum wage would have only increased 4%, from $4.25 to $4.42 an hour.
Is our jobless rate higher because we suck? Precisely the opposite. The biggest single factor is that Washington state is such a desirable place to live that people move here without finding a job first, and they stay here as long as they possibly can even when they have lost their jobs. In contrast, Great Plains states like North and South Dakota -- not exactly the economic engines of the nation -- always have unemployment rates significantly below the national average.
But still, certain business lobbyists will continue pointing to our state jobless rate and offer incidental "evidence" that our minimum wage kills jobs and hurts workers. Owners of struggling/failed businesses will testify about how the minimum wage is too burdensome. Lobbyists will again offer the counterintuitive higher-wages-are-bad-for-workers argument, as they have continually since 1937 when Washington state set a national precedent by instituting the first minimum wage. (We were, and still are, No. 1!)
But their dire predictions of job losses, inflation and economic damage never come true. The state Department of Employment Security's 2003 figures show no evidence that the restaurant, retail or agriculture sectors have suffered disproportionate job loss in this weak national economy. Overall job losses in Washington state have clearly been driven by the higher-wage manufacturing sector.
A new analysis by the Economic Policy Institute shows that Washington state mirrors the national trend of contraction in high-wage sectors and expansion of low-wage job sectors. Indeed, the minimum wage-paying retail sector has been among the biggest job gainers of all sectors lately in this state. Hiring for seasonal agriculture workers was a big factor in Yakima County's ranking in December as the second-best job-creating county in the entire nation. (We're No. 2!) (FYI, Thurston County was also in the top 10.)
As the bearers of good news -- if you call job growth restricted to low-wage sectors "good news" -- WSLC Legislative Update can already hear the harrumphing from the nattering nabobs of negativity in the business community. They hate it when people counter the We Suck™ message. One of Washington's many business-funded "think tanks" recently published a report critiquing two national business-funded think tanks that ranked Washington as 8th best in the nation for its business tax climate and also 8th for being "entrepreneur-friendly" for small businesses. The title of the local study is "The Bad News Is the Good News Is Wrong."
'Class warfare?' Been there, done that
At least one business executive who came to Olympia this week to testify in support of extending tax breaks for high-tech companies was surprised at the vehemence of the opposition in the room. He told a reporter, "I didn't think we were going to engage in class warfare."
Neither did we. At least until we saw the Priorities of Government biennial budget last year that decided business tax breaks lacking any accountability for their effectiveness were a greater priority than health care for poor children (among many, many other things).
Business owners and legislators who weren't prepared for the dozens of angry people that attended Monday and Tuesday's hearings on extending research-and-development tax breaks were due for a reality check. That "no-new-taxes" budget they proudly added to their political résumés last year inflicted real damage on the most vulnerable people in our society and the public employees trying to provide assistance to them.
People are angry about it; angry about what they perceive to be badly misplaced priorities. And when they see one of the priorities of the 2004 legislature is to renew yet another set of tax exemptions for certain businesses, with little or no attempt to repair some of the damage done by last year's budget, they get even angrier. And when they hear those tax exemptions are blindly granted, "investing" precious tax dollars in nothing but job-creation promises, they get positively outraged.
The Washington State Labor Council again calls for all new and renewed tax breaks to include full disclosure of who gets them and reporting requirements. That way, legislators and taxpayers can assess whether our investment is worth it. Some legislation designed to accomplish just that will be heard Thursday, Jan. 29 in the House Finance Committee (see hearings schedule below).
Promote apprenticeship opportunities
This week, the House Commerce and Labor Committee heard HB 2439, which promotes job training and apprenticeship by requiring that at least 15% of total labor hours on major public works projects be performed by apprentices. Back in 2000, Gov. Locke issued an executive order that essentially phased in those requirements. So already, state-funded projects that cost more than $1 million have this 15% requirement. HB 2439 would put it into statute.
When the governor first issued his executive order, some expressed concerns that it could raise construction costs or exclude contractors from certain regions of the state from bidding on public works projects. That's why language was included that waives the requirement if not enough apprentices are available and in certain other extraordinary circumstances. In fact, as long as contractors can demonstrate a good-faith effort to comply, they are in compliance.
So none of the negative consequences predicted back in 2000 have materialized. That's why the WSLC urges swift passage of HB 2439. With today's renewed focus -- at the state and national levels -- on the importance of job training and retraining, our government should be doing everything it can to create opportunities for workers to enter family-wage occupations. Promoting apprenticeship, a proven success as a job-training model, is a perfect way to achieve that goal.
Despicable training practice should be banned
During Wednesday's hearing on apprenticeship utilization, the House Commerce and Labor committee also considered HB 2352, which would prohibit employers from requiring workers to train their successors. The committee heard some powerful testimony from Myra Bronstein who was laid off by a Bellevue software company last year. The company decided to hire contractors in India to replace all of their software testers. When they announced one Friday that everyone was losing their jobs, the company told them they would be retained long enough to train their replacements (beginning Monday), and that training was mandatory. Failure to do so would cost them their severance packages, unemployment insurance and medical insurance through COBRA, the company said. Bronstein concluded her emotional testimony by urging lawmakers to make this despicable practice illegal. The WSLC urges the same.
Don't forget next week's rally in Olympia
The Washington State Building and Construction Trades Council has scheduled a "Respect Working Families" labor rally and march for Friday, Jan. 30 in Olympia. The rally is from 10 a.m. to 1 p.m. and participants are urged to visit their legislators from 1 to 2:30 p.m. Organizers plan to send a message that legislators will be accountable for the decisions they make this session regarding workers’ compensation, prevailing wage, unemployment benefits and other important issues. Buses are being chartered from across the state. For more information, contact the BCTC at (360) 357-6778.
Hearings next week
MONDAY—House Commerce and Labor at 9 a.m. will hear HB 2405 which makes it harder for the state to ship work overseas and HB 2768 which similarly zeroes in on the overseas contracting by higher education, and the Departments of Corrections and Transportation.
TUESDAY—House Commerce and Labor at 6 p.m. will hear HB 2770 and other bills related to the right to organize unions free from employer intimidation, harassment and interference.
WEDNESDAY—House Health Care at 6 p.m. will hear HB 2785, the Health Care for Washington Workers bill.
THURSDAY—House Finance at 9 a.m. will hear HB 2762 requiring accountability and disclosure provisions in tax exemptions, HB 2654 requiring regular tax-expenditure reports that list and analyzes tax exemptions, and another bill to limit tax breaks which we're told is being assigned a number as you read this.
Next Update: Tuesday, January 27
Expect to hear more details about the Health Care for Washington Workers bill, the attacks on our workers' compensation system and the building trades rally on Friday, Jan. 30.
PREVIOUS EDITIONS of the 2004 WSLC Legislative Update:
Jan. 16 -- R&D needs Reporting & Disclosure (plus workers' comp, health care, and home care)
Copyright © 2004 Washington State Labor Council, AFL-CIO